R&D Tax Credits: filing with an amended or an original tax return


At GrantTree, we deal with a lot of different companies with a lot of different approaches when it comes to filing their accounts and where/when R&D Tax Credits should be included. During the 5 years we have been up and running, we have identified the best practice to make sure a claim gets through HMRC’s labyrinths as smoothly as possible: submitting the R&D Tax Credits claim as an amendment to the original accounts. Let’s dig a little deeper into exactly why we do this and how it benefits those filing a claim.

The background:

You will already know that an R&D claim is split into the financial and the technical sections. Within the financial section at the end of your calculations, the figure needs to be inputted into a document called a CT600 (the form which, along with your Corporation Tax computations) makes up your Tax Return).

Our discovery – everybody loves a shortcut:

When an R&D claim is being processed, what we have found is that speed is of the essence. You probably don’t want to be waiting for months on end to receive your R&D claim and the way we have identified as the quickest way to get round this is crucial: do everything exactly as you have always done it. Compile and file your accounts and tax return (CT600 and computations) without the R&D amount – just carry on as normal. Once your accounts and tax return have been filed, create an amendment to your CT600 and computations which you can then re-file with HMRC.

How it works:

When a CT600 is submitted, it ordinarily goes to HMRC’s general office. The people that work there are much less familiar with R&D claims, and in our experience, are much more likely to question the inclusion of R&D figures in the CT600. We’ve found this out the hard way by going through enquiries, where HMRC can do any of the following: call for more information, write a letter asking us to expand on what was included in the CT600 and claim, or organise a face to face enquiry. All three of these types of enquiries hold up the claim being accepted. It could be an extra month, but some enquiries have in the past gone on for over a year.

By filing your CT600 in the usual way without the R&D figures and then compiling an amendment to file directly with the relevant R&D unit, it means that the amended CT600 and computation go directly to the relevant HMRC R&D specialist. They know the R&D Tax Credit scheme inside out so will be much more likely to understand your claim and ensure it gets processed in the quickest possible way. Think of them like a butcher to Tesco – Tesco may sell meat, but the butcher really knows their stuff and will be able to understand and interpret your needs more effectively.

“But isn’t that a bit dodgy? I don’t want to submit an incorrect tax return.”

Submitting without the R&D figure in the original tax return is not ‘incorrect’. It reflects the tax position at the point of filing. The amendment is purely an update to reflect the new tax position after the claim has been submitted. It allows you to bypass the legislative quagmire of HMRC and the best bit is: you can carry on doing everything as normal in terms of filing your original accounts. The only thing that needs to change is that after you have filed your accounts and tax return, you need to amend your CT600 to include the R&D figure you are claiming for and then submit this along with the claim document to the relevant R&D unit.

Well, there you have it. Our bona-fide shortcut to make sure that your application is seen by the appropriate channels at HMRC and that you can receive your claim money as quickly as possible.

If you want more information on filing amended tax returns or just your R&D claim in general, please do get in touch  and we will help advise you about the best way to move forwards. Good luck!

If you are curious about R&D Tax Credits, Innovation Grants and Open Culture